HUBZone Program

April 13, 2006

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The Historically Underutilized Business Zone (HUBZone) Empowerment Contracting program, which was enacted into law as part of the Small Business Reauthorization Act of 1997, provides federal contracting assistance and opportunities for qualified small businesses located in distressed historically underutilized business zones, known as "HUBZones."

Among other things, it allows small firms located in many urban or rural areas to qualify for sole-source and other types of federal contract benefits. The underlying purpose of the program is to encourage economic development and increase employment opportunities.

The HUBZone program falls under the auspices of the Small Business Administration (SBA), which is responsible for implementing the program and determining which businesses are eligible to receive HUBZone contracts. SBA maintains a listing of qualified HUBZone small businesses that federal agencies can use to locate vendors and also adjudicates protests of eligibility to receive HUBZone contracts. In addition, SBA is responsible for reporting to Congress on the program's impact on employment and investment in HUBZone areas.

While the Small Business Reauthorization Act of 1997 increased the overall government-wide procurement goal for small business from 20 to 23 percent, the statute sets the goal for HUBZone contracts at 1-1/2 percent for 2000, 2 percent for 2001, 2-1/2 percent for 2002, and 3 percent for 2003 and thereafter.

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